More joyful economic news

Disclaimer: in re-reading some of my posts on the economy I worry that I sound like I'm cheering for a recession. I'm not. I have very real personal financial reasons to want to see the stock market and the overall economy strong.

That said, here's the latest round of good news:

Worries grow for worse 'stagflation'
By JEANNINE AVERSA, AP Economics Writer
Tue Feb 26, 2008
WASHINGTON - It's a toxic economic mix the nation hasn't seen in three decades: Prices are speeding upward at the fastest pace in a quarter century, even as the economy loses steam.

[Note: this is that previously-thought-impossible combo of inflation & slow growth that was embarrassing when I took my one & only college economics class in the early '70s]

Reports reflect bleak housing picture
By J.W. ELPHINSTONE, AP Business Writer
Tue Feb 26, 2008
NEW YORK - House prices may still have a long way to fall.
...
U.S. home prices dropped 8.9 percent in the final quarter of 2007 compared with a year ago, according to the Standard & Poor's/Case-Shiller home price index released Tuesday. That marked the steepest decline in the index's 20-year history.

Seems like it'll be awhile till we really know just how bad this segment is going to get...

Confidence plunges, inflation rate soars
By MARTIN CRUTSINGER, AP Economics Writer
Tue Feb 26, 2008
WASHINGTON - In more bad economic news, consumer confidence and home prices posted sharp declines while higher costs for such basics as food, energy and medicine left wholesale inflation rising at a pace unseen since late 1981.
...
Over the past 12 months, wholesale prices rose by 7.4 percent, the largest yearly gain since late 1981. Analysts warned consumers to brace for more bad inflation news with crude oil prices rising to records above $100 per barrel and with more evidence that the prolonged jump in energy prices is starting to break out into more widespread price problems.

Meanwhile, the New York-based Conference Board reported that its confidence index fell to 75.0 in February, down from a revised January reading of 87.3. The drop was far below what analysts had forecast and put the index at its lowest level since February 2003, a period that reflected anxiety in the leadup to the Iraq war.

One of my colleagues argues that bad economic news is self-sustaining & self-fulfilling: if you tell folks often enough that things are bad, they start to believe it... and to ACT as if they believe it - cutting personal spending... which generates more bad news, which folks act on... etc.

There's probably something to this.
But it doesn't mean the economy is healthy!
[Just because you're paranoid doesn't mean folks aren't out to get you!]

As stated in introductory 'disclaimer' I have every reason to hope recession does not materialize... but I am not sanguine.